To litigate or not to litigate? - the Federal Redress Scheme

Update on the Commonwealth's response to child abuse

As the Commonwealth Government’s Redress scheme continues to be debated, we address a question that many clients have already asked of us. This is the critical issue of whether to seek redress through the government’s Scheme or pursue litigation for compensation through the courts, which may result in a much larger payout.

In order to analyse the question, let’s look at some background.

Ryan Carlisle Thomas has previously referred to some of the shortcomings of the Commonwealth Redress Scheme for Institutional Child Sexual Abuse Bill (‘the Bill’) that was recently introduced in Parliament.

In addition to the above, survivors may consider which institutions might be responsible for the abuse that they suffered while under the care. Survivors will need to know who is responsible for their care during the period they alleged they were abused.

What if I was abused in more than one institution while in care?

It is not uncommon for survivors to have been under the care of more than one institution. This is particularly the case for former Wards of the State placed in a number of State-run institutions, or in a number of institutions run by religious orders.

According to the Explanatory Memorandum to the Bill, where a government, for example, is involved in a shared chain of responsibility (that is, where there is more than one institution connected to a case of abuse), greater consideration will be given to factors including: who was responsible for the placement of the child in an institution and; who was responsible for the care of the child at the time of the abuse to determine which institution should bear the costs of redress.

Further consideration to these factors will need to be outlined under the Scheme so that survivors are in a position to consider their eligibility to apply for redress.

So, how will the scheme work when one institution that is responsible for alleged abuse opts in to the Scheme but another responsible institution does not? In such a situation, it seems that survivors will have to pursue their entitlements by way of Common Law. It will be interesting to see the responses of institutions to this situation. It is likely that by accepting a redress scheme a survivor may be prevented from subsequently bringing common law proceedings against that institution, or related entity. In other words, survivors may be required to sign a Deed of Release indemnifying that institution.

Further, if payments from the Scheme are classified as ‘pain and suffering’ as opposed to ‘ex gratia’, those payments may significantly reduce the benefits available to a survivor who is pursuing a common law claim, even if that claim is against a party who did not compensate them via the scheme. In these circumstances, survivors might decide to not pursue a second institution because the costs associated may outweigh the potential benefits.

If a survivor does not decide to pursue a second, yet responsible, institution the Scheme has arguably failed to take into account the justice or restoration that occurs when an institution accepts liability for wrongdoing.

Implications for litigation

According to the Explanatory Memorandum to the Bill, applications under the Scheme will have a lower evidentiary standard of proof compared to thresholds in common law claims for compensation through the courts. This may mean that survivors might find it easier to obtain redress under the Scheme than through civil litigation in the courts. With this in mind, survivors may well decide to secure a payment via the Scheme in order to avoid delays, trauma and costs.

On the other hand, survivors will have to take into account that the Scheme will deal primarily with sexual abuse and related non-sexual conduct, and will need to consider the other shortcomings of the Scheme before making decisions about how to proceed. Given the complications, a plaintiff would be well advised to seek legal advice about the common law process before proceeding with either a common law claim or under the Scheme.

What if I have previously signed a Deed of Release against one participating institution? Will I be able to receive a top up?

According to the Explanatory Memorandum to the Bill, survivors who have received redress under another scheme or received compensation through a settlement or by judgment of a court will not be excluded from applying for redress under the Scheme. However, this still leaves survivors with a degree of uncertainty about their entitlements under the Scheme.

Under the Scheme, prior payments made by a participating institution responsible for abuse to a survivor within the scope of this Scheme will be deducted from the amount payable in future. This means that survivors who have previously received redress or compensation, might receive additional redress under the Scheme but the amount might be limited depending on the amount of redress previously received and inflation.

Appealing a determination under the Scheme

As previously mentioned by Ryan Carlisle Thomas, the only way to appeal an unsatisfactory determination under the Scheme will be by way of internal review.

According to the Bill, survivors can appeal the acceptance or rejection of an application for redress or the amount of redress awarded. An internal review will be conducted by an independent decision maker (‘IDM’). More information about the IDM can be found here: https://rctlaw.com.au/legal-blog/2017/what-does-the-new-commonwealth-redress-scheme-mean-for-survivors. Our previous experience in dealing with IDMs under various religious redress processes gives us cause for concern. The people appointed as ‘independent internal reviewers’ often have affiliations with the institution and their decisions at times appear biased. Further, the fact an internal reviewer is funded by the Scheme creates an appearance of bias.

When making a common law claim for compensation in institutional abuse matters, the usual appeal pathway is by way of the court system. Although this pathway has obvious pitfalls such as increased costs and unforeseen procedural delays, litigation may be the only way forward for those survivors who have suffered non-sexual abuse. This is because sexual abuse, rather than non-sexual abuse, is central to the Scheme.

Our firm continues to press and advocate for improvements to the Scheme as it takes shape. You can follow continuing analysis over the coming weeks.

In the meantime, if you would like more information about making a claim for compensation for abuse that you or someone you know suffered during care, our Institutional Abuse department can be contacted on 1300 366 441 or via email at iaclaims@rctlaw.com.au.